European markets are expected to open higher Thursday morning as investor focus swings to the potential economic recovery and earnings season gets underway.
Britain’s FTSE 100 is set to climb around 28 points to 6,184, Germany’s DAX is seen around 140 points higher at 12,635 and France’s CAC 40 is expected to gain around 39 points to 5,020, according to IG data.
European stocks look set to follow overnight action in Asia Pacific, where markets advanced on the back of a continued rally in mainland China, bolstered by the release of Chinese inflation data.
Despite the persistently rapid spread of the coronavirus in the U.S., where the number of cases surpassed the 3 million mark on Wednesday, according to Johns Hopkins University, investor optimism has returned over the prospects of a recovery for the global economy as signs of progress emerge in data and scientific discovery.
Gilead Sciences on Wednesday began testing an inhalable form of its antiviral Covid-19 drug remdesivir which can be administered outside hospitals. Meanwhile Reuters reported, citing a European Commission source, that the Commission has secured deals for experimental treatments from Merck and Roche.
Wednesday also saw further fiscal stimulus from a major European economy, as U.K. Finance Minister Rishi Sunak announced a back-to-work bonus scheme for businesses bringing furloughed employees back to work, and a 50% restaurant discount for all citizens through August. Sunak in total promised 30 billion pounds ($38 billion) of measures to stave off a much-feared unemployment crisis.
In corporate news, Airbus deliveries climbed by 50% from May to June, but the first half of the year still marked a 16-year low as the coronavirus pandemic and worldwide shutdowns ravaged demand.
German software manufacturer SAP said business activity gathered steam at a greater pace than expected in the second quarter, confirming its full-year outlook with revenues and operating profits increasing.